What to Buy When the Swiss Are Selling

The Swiss National Bank has euros ready to unload, and some strategists point to currencies that should benefit.

Keeping a currency in check isn't easy, especially if it's the paragon of safe havens. Just ask the Swiss, who have been loading up on euros and selling Swiss francs to try to curb the franc's rise.

Unfortunately for euro holders, the Swiss are ready to sell some of their massive common-currency stake. But that's also creating an opportunity, say the strategists at Barclays Capital.

"These flows will be felt the most in EUR/CAD and EUR/GBP, some of which has likely already happened in July," they wrote in a note to clients. "The less liquid "other" currencies (ie, AUD, SEK, DKK, SGD, KRW) will also be supported by the SNB's diversification flows," they add.

Remember, currencies with less float will move more on a given increase in demand, so a little bit of euro selling against these other currencies could go a long way. And with the euro now accounting for some 60 percent of Swiss National Bank reserves, up from 51 percent at the end of the first quarter, you can almost certainly expect some serious euro selling efforts.